Diageo is celebrating the opening of its new logistics hub for its Asia Pacific business.

The drinks giant said yesterday (10 October) that the facility, set up with logistics provider IDS Group, was opened earlier this week in Singapore at a cost of SGD$13m (US$8.2m). The partnership between the two companies will handle all of Diageo's Asia Pacific logistics requirements, the drinks company noted.

"Asia Pacific is a key growth market for Diageo," said John Pollaers, managing director of Diageo in Asia. "The setting-up and opening of our logistics hub in Singapore is a complete overhaul of Diageo's Asia Pacific supply chain, maximising our efficiency whilst allowing us to be more flexible and responsive to meet the needs of a diverse and growing Asian market.

"We are extremely impressed by IDS Group's capabilities, track record and their approach to our needs. They are an ideal partner for Diageo and we have found synergies in our corporate values and culture. Singapore's many strengths - its infrastructure, skilled workforce and geographical location - made it the country of choice over its many competitors for managing the logistics side of our business in Asia."

"Diageo's decision to consolidate its regional management and logistics for the Asia Pacific region and site its regional distribution centre here is a boost to our aim of becoming the supply chain management nerve centre of Asia," added the chairman of the Singapore economic development board, Lim Siong Guan.

The facility will be located at the IDS Group's ASRS (Automated Storage and Retrival System) facility in Tuas, one of Asia's largest and most technologically advanced distribution facilities.  Premium bottled product such as Johnnie Walker and Singleton will arrive at the centre from Europe and will then be labelled, packaged, and put through quality control checks before being distributed to the different markets including Korea, Australia and China.

The facility will store Diageo inventory to the value of SGD60m and will complete the final market-specific labelling and packaging at the last moment on bespoke, high-speed, semi-automated production lines, the company added. As a result of the new facility, Diageo claims that the average product lead-time from production through to point-of-sale will be cut from eight to ten weeks down to one to three weeks.

The company's regional headquarters for Asia and Greater China are also located in Singapore.